Airlines operating in Nigeria are now forced to make immediate payments for aviation fuel as the lingering scarcity of the commodity has triggered a rash of flight delays and cancellations in recent days.
BusinessDay gathered that before the scarcity of the fuel, airlines usually paid marketers two or three days after the supply of the commodity.
Findings show that despite the high cost of aviation fuel, airlines had since Tuesday adopted what was described as a ‘pay as you go’ strategy as marketers were unwilling to sell to them on credit.
Airlines have, however, described the new measure as sustainable.
Kingsley Ezenwa, spokesperson for Dana Air, told BusinessDay that marketers insisted that amid the high cost of the product, cash must be paid before supply of the product would be made.
According to him, airlines that have been able to meet this demand are getting a steady fuel supply.
Oil marketers, who craved anonymity, said the rise in crude oil prices globally had impacted the local market, adding that airlines that cleared their credit on time would get the product faster than airlines that owe after purchasing the product on credit.
A visit by BusinessDay to Lagos local airport, Murtala Muhammed Airport 2, on Wednesday, showed that most flights were operated without delays or cancellations, indicating that the new measure was already making an impact.
Read also: Airlines seen shifting to smaller planes over aviation fuel scarcity
George Uriesi, chief operating officer of Ibom Air, said the airline, which had some delays on Tuesday, was having seamless flight operations on Wednesday because it found a “temporal” measure to ensure flights were operated without delays.
Uresi, who described the measure as ‘very fragile,’ said the price at which the airline was buying aviation fuel was not sustainable.
“All airlines are making plans but we have to watch the terrain. You can plan for uncertainty but where aviation fuel is sold for N450 per litre and the next day it goes up to N600 and N800 the next day, what plans can be made to cushion this effect?” Uriesi added.
The price of aviation fuel, which ranged from N230 to N250 per litre across different states in the country last year, rose this week to N590 in Lagos; N599 in Abuja and Port Harcourt; and N625 in Kano.
In a related development, six airlines, namely Air Peace, Azman Air, Arik Air, Aero Contractors, Max Air and United Nigeria, have engaged in a form of partnership or codeshare to enable them to leverage services that each of the airlines offer.
Described as ‘Spring Alliance,’ the alliance allows passengers booked on any of these airlines to fly their sister airline in a situation where there are flight cancellations or delays, according to a joint statement.
Explaining the initiative, Allen Onyema, CEO of Air Peace, said, “With this alliance, the flying public will reap the benefit. For example if Air Peace has a tech issue on any of its aircraft, the passengers of Air Peace need not to be delayed, if any member of this alliance is going to the same destination.
“All we need to do is move the passengers over to that other airline, a member of the alliance, at no further cost to the passenger.”
Onyema described the initiative as a revolution in Nigeria’s aviation sector, urging other airlines to tap into the benefits offered by the alliance by joining.
According to him, the alliance is not limited to Nigerian airlines alone, as it is open to other airlines in Africa.
He said the alliance would help sustain airlines’ operations and help the flying public experience seamless commuting whenever they choose to fly.
Obiora Okonkwo, the CEO of United Nigeria Airline, said, “There’s no doubt that Nigerian airlines are going through some situations and part of the ways to react to this is to have the passengers in mind. It is simply thinking out-of-the-box.
“We are not reinventing the wheel, we are just adopting what we have seen that has worked in other places, and it will surely work in Nigeria so that the passengers going to the airport are more guaranteed that they will fly.”
